Four Tips for Handling Reductions in Force
Hopefully, in your manufacturing business, things are going great right now. But, as we all know, the manufacturing business often experiences cyclic ups and downs, and the next restructuring could be right around the corner. It is to your benefit to be prepared should a reduction in force become necessary. Being ready for your next RIF can help it go more smoothly and prevent any potential legal entanglements.
Here is a layoff guide with four tips on how to handle your next RIF.
1. Make Sure It’s Time for the RIF
It’s not time to panic as soon as your company’s profits take a dip. There are many ways to stabilize the ship that may not require layoffs. If you simply cannot afford the cost of maintaining your current staff, consider furloughing employees, switching some employees to part-time or contractor status or establishing a hiring freeze.
If you’re a smaller organization, you might consider talking to your employees about the situation before making any moves. That can be an awkward conversation to have, but they just might have some ideas you haven’t thought of.
2. Have a Clear Selection Method
If you do have to lay off employees, there should be no confusion about why the laid-off employees were chosen. You may have a last in, first out policy, productivity benchmarks for employees to hit or skill-based criteria — whatever you choose, it should be in place before an RIF is required. Your employees should understand how it works, and you should have a dedicated HR person who handles and documents everything related to the selection and laying off process.
3. Make Sure the RIF Decisions Are Fair
People are very sensitive to the possibility of discrimination in layoffs — and rightly so. If you need to lay off someone in a protected class, you need to be very careful that you are in compliance with discrimination laws and that your composition of remaining workers and laid off workers with respect to protected class individuals is reflective of the general population. In fact, you are required by EEOC regulations to perform a statistical analysis of this type before carrying out the RIF.
4. Have a Clear Severance Plan
Many employers come up with a severance plan on the fly, which is a sure way to guarantee the RIF process will not go smoothly. Generate a fair severance plan for employees now, so those affected by the RIF will feel taken care of when it happens. You will also want to be sure to inform those employees regarding how to continue their health benefits through COBRA.
Has your manufacturing company ever had to go through an RIF? Multiple RIFs? How did you handle it? How are you preparing for the next one? Drop us a note in the comments and let us know. After you’ve done that, you can learn more about manufacturing tips and manufacturing repair by visiting us at Global Electronic Services.